There is no repugnancy between provisions of RERA and Karnataka Apartment Ownership Act: Karnataka High Court

In a ruling that clarifies the legal architecture for residential apartment governance, the High Court of Karnataka has said there is no repugnancy between the provisions of the Real Estate (Regulation and Development) Act, 2016 (RERA) and the Karnataka Apartment Ownership Act, 1972 (KAOA).

“The provisions of RERA will apply from the stage of development of projects till handing over of possession of the apartment to the owners and the undivided share of the project in favour of the association of owners formed under the provisions of KAOA. And the provisions of KAOA will be applicable once such handing over is complete and the association is formed in accordance with the law. In other words, the provisions under RERA are applicable to the pre-ownership stage, and the provisions under KAOA are applicable post-ownership,” the Court said.

The right body

The Court also reiterated that the association of owners formed under the KAOA is the right body to maintain and manage residential apartments, and not a cooperative society registered under the Karnataka Cooperative Societies Act, 1959.

Justice M.G. Uma passed the order while allowing a petition filed by Sobha Limited, the developer of the 395-unit Sobha HRC Pristine apartment complex in Jakkur.

The developer had challenged the registration of Sobha HRC Pristine Apartment Owners Cooperative Society in September 2023 as a parallel body to Sobha HRC Pristine Owners’ Association, which was formed in June 2023 with most of the 323 owners, who had received sale deeds as members.

A group of 30 to 40 of them had registered the cooperative society under the Karnataka Cooperative Societies (KCS) Act, claiming grievances against the builder. The society had claimed that various provisions of RERA require registration of a society under the provisions of the KCS Act, while claiming that RERA, being a Central legislation, prevails over KAOA.

Can operate alongside

While rejecting society’s contention that the KCS Act could operate alongside KAOA in a purely residential project, the Court said that “the cooperative society is not a good vehicle to fulfil the objectives of maintaining, administering, managing the residential apartments or the common areas on behalf of the owners.” The Court also said that the society could not demonstrate any repugnancy between the provisions of the RERA and the KAOA.

When KAOA, the special enactment, is capable of fulfilling the needs of the owners of the residential apartments, even if any minor shortcomings or drawbacks are to be noted, the same cannot be grounds for the registration of a society under different enactments like KCS Act, which do not co-relate with the objectives with which the KAOA was enacted, the Court said. It ordered the cancellation of the registration of the society.

If purchasers or owners have grievances against the builder, they are free to approach RERA authorities or consumer courts individually, but cannot form parallel associations for maintenance, the Court clarified.